Insurance Department Releases Rebate Data for Calif. Health Insurers

On Tuesday, the state Department of Insurance released information on rebates being sent out by California health insurers this week under a federal health reform law provision, the Sacramento Bee reports (Buck, Sacramento Bee, 8/1).

Background

Under the reform law's medical-loss ratio rule, private insurers must spend at least 80% in the individual market or 85% in the group market of premium dollars on direct medical costs.

Insurers that do not comply with the ratio must issue rebates to consumers.

About 1.8 million Californians are expected to receive a total of $73.9 million in rebates.

The average rebate amount in California is about $65 per family (California Healthline, 7/25).

Rebates Issued by California Insurers

According to DOI, California insurers sending MLR rebates include:

• Aetna Life Insurance, which is issuing $3.4 million in rebates to large-group employers covering 84,428 policyholders, with an average rebate of $40.50;
• Anthem Blue Cross, which is issuing $38.6 million to 182,214 small-group policyholders with an average rebate of $212.
• Anthem Blue Cross Life and Health Insurance, which is issuing $1.3 million to 407,429 individual policyholders with an average rebate of $3.16;
• Blue Shield of California Life & Health Insurance Co., which is issuing $10.8 million to 239,595 individual policyholders with an average rebate of $45.15;
• Connecticut General Life Insurance, which is issuing $3.4 million to large-group employers covering 89,575 policyholders with an average rebate of $37.70;
• Kaiser Permanente Insurance, which is issuing $277,034 to 21,823 individual policyholders with an average rebate of $12.69;
• PacifiCare Life and Health Insurance, which is issuing $789,615 to large-group employers covering 63,600 policyholders with an average rebate of $12.42; and
• United HealthCare, which is issuing $3.8 million to 22,260 small-group policyholders with an average rebate of $173 (Sacramento Bee, 8/1).

Comments on Rebates

California Insurance Commissioner Dave Jones (D) said, "The health insurance premium rebates are another important benefit of the Affordable Care Act." He added, "We will continue to take any and all necessary steps to ensure that health insurers are complying with the law" (Department of Insurance release, 7/31).

Anthony Wright, executive director of consumer advocacy group Health Access California, said that rebate checks are "a symbol of the new oversight over the [health insurance] industry to ensure patients got the best value for their premium dollar" (Terhune, "Money & Co.," Los Angeles Times, 7/31).